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International Cooperation Department
Tel.: (+86-21) 65853850-8034
Fax: (+86-21) 65373125
E-mail: ICDept@sisi-smu.org
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International Shipping |
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| Suez shipping may lead to global rate collapse: Xeneta |
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Date:2025-05-15 Readers:
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A RETURN of containerships to Suez after the ceasefire between the US and Houthi forces would flood the market with shipping capacity and cause a global rates collapse, reports New York's Marine Link.
Data released by Xeneta, an ocean and air freight intelligence platform, shows global TEU-mile demand would decrease six per cent if containerships begin sailing through the Red Sea and Suez Canal again instead of diverting around the Cape of Good Hope.
TEU-mile demand factors the distance each TEU is transported globally as well as the number transported. The six per cent is based on global container shipping demand growth of one per cent for full year 2025 and a large scale return of containerships to the Red Sea in H2.
Of all the geo-political disruptions impacting ocean container shipping in 2025, conflict in the Red Sea continues to cast the longest shadow, so any meaningful return to the region would have massive consequences," said Xeneta analyst Peter Sand.
"Container ships returning to the Red Sea would flood the market with capacity with the inevitable outcome of collapsing freight rates. If we also see a continued slowdown in imports into the US due to tariffs, then the collapse will be even harder and more dramatic," said Mr Sand.
Average spot rates from the Far East to North Europe and Mediterranean are US$2,100 per FEU and US$3,125 per FEU respectively. This is an increase of 39 per cent and 68 per cent compared to pre-Red Sea Crisis levels on December 1, 2023.
From the Far East to US east coast and US west coast, spot rates stand at US$3,715 per FEU and $2,620 per FEU respectively. This is an increase of 49 per cent and 59 per cent compared to pre-Red Sea Crisis.
https://www.shippingazette.com/news?news_id=9250500000363
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